Exit and Growth Strategies for Middle Market Businesses

The report below presents you with a good overview on the first quarter M&A activity in the Hospitality & Leisure Industry Sector. M&A activity for North American based target companies in the Hospitality and Leisure sector for Q4 2017 included 61 closed deals, according to data published by industry data tracker FactSet.

One of the most notable transactions of the quarter closed in December when NRD Capital Management, LLC, a private equity firm specializing in investments in middle market, later stage, mature, turnaround and emerging growth companies, acquired Ruby Tuesday, Inc. for US$146.9 million in cash. Under the terms of the agreement, NRD Capital Management would pay US$2.4 in cash for each share of Ruby Tuesday, which represents a 21% premium to Ruby Tuesday’s closing stock price last October 13, 2017.

The hospitality sector is in a stage of flux to some degree as peer-to-peer platforms like Airbnb continue to gain market share.

Industry Indicators

The value of US nonresidential construction spending, an indicator of lodging demand, dropped 0.5% year-to-date in November 2017 compared to the same period in 2016.

US personal income, which drives travel activity, rose 3.8% in Nov. 2017 compared to the same month in 2016.

Total US revenue for accommodation rose 3.0% in the third quarter of 2017 compared to the previous year.

US tourism spending on traveler accommodations, an indicator for lodging revenues, increased 3.9% in the third quarter of 2017 compared to the same period in 2016.

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